The oil market has shown it is largely immune to US sanctions drama, policy reversals, and political theatrics. After the spring tariff shock, traders adapted quickly. Even the latest U.S. sanctions on Russian oil companies produced only a brief reaction before prices settled back into their tight range. The market’s skepticism is justified: Washington has not demonstrated a willingness to enforce sanctions strictly, and without credible enforcement, risks remain underpriced but contained. Still, the market may be underestimating risk in the fate of Lukoil’s international assets. The U.S. blocking Gunvor’s attempted purchase signals a more assertive sanctions posture. Whether these assets are split among several buyers, or seized outright by governments for energy security, operational disruption is likely. Here, unlike with Trump’s headlines, the market should pay attention.
Saudi–U.S. Energy Relations Are Evolving
The recent Saudi visit to Washington underscored another shift. Oil was notably absent from the agenda, not because it is irrelevant, but because both sides see little to dispute at current price levels and general oil policy alignment. U.S. gasoline prices remain far below politically sensitive thresholds, reducing pressure on Riyadh. And any suggestion Saudi Arabia is “gifting” low prices to Trump misses the structural dynamics: balances were always expected to soften into early 2026.